ATMega can't run code from RAM, only from built-in Flash memory, so any AVR-based computer is rather limited, you can only use preprogrammed code or use some interpreter for loadable programs (which is slow, and best perfomance with native code is ~20MIPS). With native code one ATMega has enough resources to emulate AY-3-8910, or SID (with limitations), or play 4-channel MODs.
And I don't think there is any sound hardware. So it is may be easier to design own system than hack this.